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HEAD OFFICE

“Reliance Insurance House” PABX : 4539415-17181-A, Sindhi Muslim Co-operative Fax : 4539412Housing Society, Karachi. E-mail : [email protected]

[email protected] : www.relianceins.com

Mr. A. Razak Ahmed Direct : 4539413, 4539414Chief Executive & Managing Director Extention : 204

Mr. Haroon A. Shakoor Direct : 4539409Chief Accountant & Extention : 203Company Secretary

Mr. M. Amin Bawany Direct : 4557079Vice President (Marine & Accident)) Extention : 201

Mr. Muhammad Ishaque Azeem Direct : 4557079Vice President (Fire) Extention : 212

Mr. Sadruddin Hussain Direct : 4550403Vice President (Claims) Extention : 208

Mr. Abdul Rahim Patni Extention : 215Manager (Reinsurance)

Mr. Muhammad Salim Memon Extention : 214Manager (Investment / Shares)

Mr. Ghulam Mujaddid Extention : 205Deputy Chief Manager (Accounts)

Mr. Muhammad Masood Alam Direct : 4539411Manager (Administration) Extention : 206

Mr. Muhammad Masood Ali Extention : 202Manager (IT)

Mr. Ramesh Kumar Extention : 220Assistant Manager (Internal Audit)

South Zone Office & Branches

M. A. Jinnah Road Branch101, Japan Plaza, Ph : 2727076, 2729961M. A. Jinnah Road, Karachi. Fax : 2722601

Business Plaza Branch407, 4th Floor, Business Plaza Mr. Muhammad Iqbal Dhedhi Ph : 2419581, 2419582Off, I.I. Chundrigar Road, Karachi. Executive Vice President Fax : 2421314, 2421317

Namco Centre Branch1-A, 5th Floor, Campbell Street, Mr. Iqbal Umer Bawany Ph : 2625176, 2624427Karachi. Vice President Fax : 2624783

Tariq Road BranchRoom No.A-2 & A-3, Mr. Zafar A. Pasha Ph : 4527806, 45324271st Floor, Rahat Jo daro, Executive Vice President 4525376, 4322642Plot No. 172/L. Block-2, PECHS, Fax : 4522829Main Tariq Road, Karachi.

Land Mark Plaza Branch405, 4th Floor, Land Mark Plaza, Mr. Muhammad Reza Rajani Ph : 2628777, 2628778Off, I.I. Chundrigar Road, Chief Manager Fax : 2628799Karachi.

Hyderabad Branch1st Floor, Al-Falah Chamber Mr. Abdullah Ahmed Ph : 2615774Tilak Road, Hyderabad. Regional Manager Fax : 2623029

North Zone Office & Branches

Zonal Office. Lahore (North Zone)4th Floor, Gardee Trust Building. No.2, Mr. Sh. Khushnood Ashraf PABX : 7239063, 7353292Napier Road, Lahore. Executive Vice President 7234255, 7351353

Direct : 7354689 Fax : 7312526

OFFICES

Reliance Insurance Company Limited

North Zone Office & Branches (continued)

Regional Office. Lahore90-A/3, 1st Floor, Canal Park, Mr. Basharat M. Barlas Ph : 5761077, 5761078Gulberg-II, Lahore. Senior Executive Vice President 5763446, 5763447

Fax : 5761235Gulberg BranchHouse No. 17-A, Block-E/1, Mr. Tehseen Ahmed Khan Ph : 5752245, 5752989Gulberg-III, Lahore. Executive Vice President 5751971, 5756557

Fax : 5756217Eden Centre Branch321, Eden Centre, Mr. Khawaja Ahmed Fraz Ph : 7599277, 759937743 Ghausal Azam Road, (Jail Road) Chief Manager 7589669Lahore. Fax : 7576032Al-Rehman Branch2nd Floor, Al-Rehman Building, Mr. Nisar Ahmed Chughtai Ph : 7323113, 7322473Regal Cinema Lane, 65, The Mall, Senior Vice President 7354848Lahore. Fax : 7247925Garden Town BranchSuit No. 17, 1st Floor, Shan Arcade, Mr. Basit Anwar Butt Ph : 5889258, 5889259New Garden Town, Lahore Executive Vice President Fax : 5889260

Khan Plaza Branch4th Floor, Khan Plaza, Mr. Sohailuddin Zafar Ph : 4215422, 4216422G. T. Road, Gujranwala. Assistant Vice President Fax : 4448139

Model Town Branch438/1-B, Mini Market, Mr. Ch. H.S. Asghar Ph : 3254415, 3259421Model Town, Gujranwala. Vice President Fax : 3523086

Gujrat BranchShams Plaza, Near Prince Cinema, Mr. Ch. Nazir Ahmed Ph : 3522127West Circular Road, Gujrat. Vice President

Faisal Complex Branch Mr. A. Majeed Abid Ph : 2611938, 26119393rd Floor, Faisal Complex, Vice Presodent 2626480Bilal Road, Civil Lines, Faisalabad. Fax : 2621033

Taj Plaza BranchRoom No. 16, 2nd Floor, Taj Plaza, Mr. Muhammad Akhlaq Ph : 2617277, 2615922, 2622182Kotwali Road, Faisalabad. Vice President Fax : 2412010

Circular Road BranchP-156, 6th Floor, Asraf Butt Center, Mr. Mushtaq Ahmed Ph : 2638034, 2635640, 2412067Circular Road Vice President Fax : 2412068Faisalabad.

Rawalpindi Branch43/C, 2nd Floor, Bank Road, Mr. Abdul Karim Siddiqui Ph : 5700223, 5523260Near NBP, Rawalpindi. Vice President Fax : 5514384

Peshawar BranchT-3 & 4, Bilour Shopping Plaza, Mr. Abdul Salam Niazi Ph : 5274617, 52773283rd Floor, Saddar Road, Peshawar Cantt. Vice Presitent 5250830

Fax : 5284683Regional Office Multan1st Floor, 5-Commercial Plaza, Mr. Syed Bahar Shah Bukhari Ph : 4517349Opp. Civil Hospital, Abdali Road, Seinor Vice President & Fax : 4510049Multan. Regional Head

Khanpur BranchOlf Ghalla Mandi, Khanpur, Mr. Abdul Razzak Choudhry Ph : 5572772Distt. Rahimyar Khan. Vice President Fax : 5572772

Hasilpur Branch27-B, 1st Floor, Main Bazar, Mr. Muhammad Shafi Anjum Ph : 2442473Hasilpur. Vice President Fax : 2448073

Sahiwal Branch147, Railway Road, Mr. Muhammad Saeed Ph : 4467477Sahiwal. Branch Manager

Sialkot BranchRoom No. 4 & 5 1st Floor, Mr. Ghulam Rasool Farrukh Zahidi Ph : 4296075, 4296076Mughal Plaza, Kutchery Road, Branch Manager Fax : 4296077Sialkot.

Gojra BarnchP-132, Post Road, Mrs. Shahnaz Akhter Ph : 3511917Gojra. Branch Manager Fax : 3513111


CONTENTS

Page No.

Company Information .......................................................................................01

Director’s Report ..............................................................................................02

Review Report ..................................................................................................03

Condensed Interim Balance Sheet (Un Audited)..............................................04

Condensed Interim Profit & Loss Account (Un Audited)...................................06

Condensed Interim Statement Of Changes In Equity (Un Audited).................07

Condensed Interim Statement Of Cash Flow (Un Audited) .............................08

Condensed Interim Statement Of Premiums (Un Audited) ...............................09

Condensed Interim Statement Of Claims (Un Audited) ....................................10

Condensed Interim Statement Of Expenses (Un Audited)................................11

Condensed Interim Statement Of Investment Income (Un Audited).................12

Notes To The Accounts .................................................................13


COMPANY INFORMATION

BOARD OF DIRECTORS ISMAIL H. ZAKARIA ChairmanMOHAMMAD AMIN AHMED BAWANYA. AZIZ AYOOBIRFAN ZAKARIA BAWANYMOHAMMAD OMER BAWANYZOHAIR ZAKARIAAHMED ALI BAWANYNOOR M. ZAKARIAASHFAQ PATELYASIN SIDDIKA. RAZAK AHMED Chief Executive &

Managing DirectorMANAGEMENTSenior Executive Vice President BASHARAT M. BARLAS

Chief Accountant and Company Secretary HAROON A. SHAKOOR

Audit Committee A. AZIZ AYOOB ChairmanIRFAN ZAKARIA BAWANY MemberZOHAIR ZAKARIA Member

AUDITORS HYDER BHIMJI & CO.Chartered Accountants

LEGAL ADVISOR ABDUL SATTAR PINGAR

BANKERS HABIB BANK LIMITEDNATIONAL BANK OF PAKISTANMCB BANK LIMITEDALLIED BANK OF PAKISTAN LIMITEDUNITED BANK LIMITEDTHE ROYAL BANK OF SCOTLANDNIB BANK LIMITEDBANK ALFLAH LIMITEDHABIB METROPOLITAN BANK LIMITEDBANK OF PUNJABFAYSAL BANK LIMITEDJS BANK LTD.

ADDRESS REGISTERED OFFICE 96-A, Sindhi Muslim Co-operative Housing Society, Karachi.

HEAD OFFICE Reliance Insurance House,181-A, Sindhi Muslim Co-operative Housing Society,P.O. Box No. 13356, Karachi-74400.Phone: 4539415-17Fax: 92-21-4539412E-mail: [email protected]@cyber.net.pkWebsite: relianceins.com

SHARES REGISTRAR M/s. C & K Management Associates (Pvt.) Ltd.404-Trade Tower, Abdullah Haroon Road,Near Hotel Metropole, Karachi-75530Tel : (021) 5687839 & 5685930


1

DIRECTOR’S REPORT

The Shareholders,Reliance Insurance Company Limited,

Your Directors are pleased to present before you the Unaudited Condensed Interim Financial Statements duly reviewed by the auditors for the period ended June 30, 2009.

During the period under review, your Company underwrote a Gross Premium of Rs.233.586 million as compared to Rs.316.104 million of the corresponding period of last year – decrease of 26.10%. The Net Premium Income also reduced from Rs.222.404 million to Rs.159.137 million – decrease of 28.45% over the previous year. The main factor of decline in premium as also reported earlier in the Annual Report 2008, has been the management’s decision to discontinue writ ing motor Leasing business in view of extremely adverse claim experience.

Net claims incurred, however, stood at Rs.74.864 million – decrease of 27.33% over the corresponding period of last year.

Investment Income stood at Rs.11.659 million as against Rs.12.156 million of the previous year reflecting a decrease of Rs.4.088% because of recognizing Rs.5.00 million towards impairment in value of Investment in compliance to Circular # 03\2009 of SECP.

Profit before tax for the half-year ended 30th June, 2009 was Rs.23.067 million against Rs.35.019 million of corresponding period of last year – a decrease of Rs.11.952 million – 34.13%.

Your Management looks forward to the future with confidence and envisages that the new democratic government would succeed to enforce policies to meet the challenges ahead, sustained growth and improved Law and Order situation in the country.

By order of the Board

A. RAZAK AHMEDChief Executive & Managing Director

Karachi: 20th August, 2009


2

REVIEW REPORT

Independent Auditors’ Report on review of Condensed Interim Financial Information to the Members

Introduction

We have reviewed the accompanying;

i. condensed interim balance sheet; ii. condensed interim profit and loss account; iii. condensed interim statement of changes in equity; iv. condensed interim statement of cash flows;v. condensed interim statement of premium;vi. condensed interim statement of claims;vii. condensed interim statement of expenses; and,viii. condensed interim statement of investment income

of Reliance Insurance Company Ltd. (“the Company”) as at and for the six months period ended 30 June 2009 (here-in-after referred to as the “interim financial information”), Management is responsible for the preparation and presentation of this interim financial information in accordance with approved accounting standards as applicable in Pakistan. Our responsibility is to express a conclusion on this condensed interim financial information based on our review.

Scope of Review

We conducted our review in accordance with International Standard on Review Engagements 2410, “Review of condensed Interim financial Information performed by the Independent Auditor of the entity.” A review of condensed interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed interim financial information as at and for the six months period ended June 30, 2009 is not prepared, in all material respects, in accordance with approved accounting standards as applicable in Pakistan.

Other matters

The figures for the quarter ended 30 June 2009 and 30 June 2008 in the accompanying condensed interim financial information have not been reviewed and we do not express a conclusion on them.

HYDER BHIMJI & CO.Karachi:20th August, 2009 Chartered Accountants


3

Engagement Partner Hyder Ali Bhimji


4

(Un Audited) (Audited)As At June 30, As At Dec.31,

Notes 2009 2008Rs Rs

Share Capital and ReservesAuthorised share capital 500,000,000 500,000,000(2008: 50,000,000 Ordinary Shares of Rs.10/— each)

Paid-up share capital 8 252,001,750 229,092,500Retained earnings 28,187,159 41,029,056Reserves 92,605,000 85,105,000

372,793,909 355,226,556

Underwriting provisionsProvision for outstanding claims (including IBNR) 275,889,180 252,838,389Provision for unearned premium 228,159,868 243,900,820Commission income unearned 29,737,556 30,344,351

Total Underwriting Provisions 533,786,604 527,083,560

Creditors and accrualsAmounts due to other insurers/reinsurers 27,348,715 35,324,248Accrued expenses 1,704,593 2,848,472Taxation - provision less payments 3,651,093 5,309,407Sundry creditors 6,071,351 7,032,961

38,775,752 50,515,088Borrowings

Short term running finance-secured 2,015,158 5,776,363

Other liabilitiesUnclaimed dividend 115,331 120,535

TOTAL EQUITY AND LIABILITIES 10 947,486,754 938,722,102

CONTINGENCIES AND COMMITMENTSThe annexed notes from 1 to 12 form an integral part of these condensed interim financial statements.

CONDENSED INTERIM BALANCE SHEET (UN AUDITED)AS AT30TH JUNE, 2009

Karachi: 20th August, 2009Ismail H. Zakaria

ChairmanMohammad Amin Ahmed Bawany

Director

(Un Audited) (Audited)As At June 30, As At Dec.31,

Notes 2009 2008Rs Rs

Cash and bank depositsCash and other equivalent 385,648 123,719Current and other accounts 63,347,280 54,184,646Deposit maturing within 12 months 27,525,000 30,725,000

91,257,928 85,033,365Loans ( secured )

To employees 1,172,849 964,899

Investments 7 263,123,289 285,858,481

Current assets-others Premiums due but unpaid 136,266,996 106,435,031Amounts due from other insurers/reinsurers 7,962,011 6,225,857Accrued investment income 6,464,650 30,902,424Reinsurance recoveries against outstanding claims 239,446,901 214,067,719Deferred commission expense 44,423,138 47,032,113Prepaid reinsurance premium ceded 85,520,053 87,473,351Trade deposits and prepayments 540,494 540,494Sundry receivables 942,810 1,400,716

521,567,053 494,077,705

Fixed assetsLand and buildings 18,304,142 19,267,518Furniture, fixtures and office equipment 11,411,810 11,987,922Motor vehicles 38,821,840 40,255,569

68,537,792 71,511,009

Capital work in progress 1,827,843 1,276,643

TOTAL ASSETS 947,486,754 938,722,102


5

CONDENSED INTERIM BALANCE SHEET (UN AUDITED)AS AT30TH JUNE, 2009

A. Aziz AyoobDirector

A. Razak AhmedChief Executive & Managing Director

FORM GA


6

(Amount in Rs.)QUARTER ENDED 30 JUNE

Fire Marine Motor Misc. Quarter ended& Aviation & 2009 June 30, 2008

Property Transport Aggregate Aggregate

Revenue AccountNet Premium Revenue 24,775,806 15,585,807 38,928,116 955,532 80,245,261 106,104,832Net Claims (7,427,672) (2,576,875) (30,266,642) 38,340 (40,232,849) (52,537,682)Expenses (7,971,541) (5,005,195) (12,529,439) (307,803) (25,813,978) (30,216,412)Net Commission (3,145,778) (1,641,919) (5,757,003) 677,752 (9,866,948) (13,496,344)

Underwriting result 6,230,815 6,361,818 (9,624,968) 1,363,821 4,331,486 9,854,394

Investment Income 5,705,753 7,224,685Other Income (Profit on Sale of Fixed Assets) 658,346 900,620Financial Charges (128,009)General and administration expenses (2,770,552) (3,840,501)Profit before tax 7,797,024 14,139,198Provision for Taxation :Current (1,750,000) (4,300,000)Profit after tax 6,047,024 9,839,198

SIX MONTHS ENDED 30 JUNEFire Marine Motor Misc. Six Months ended& Aviation & 2009 June 30, 2008

Property Transport Aggregate AggregateRevenue AccountNet Premium Revenue 49,268,420 30,111,185 77,823,530 1,933,945 159,137,080 222,404,120Net Claims (9,204,597) (3,764,333) (61,205,422) (690,563) (74,864,915) (103,021,529)Expenses (15,328,006) (9,367,957) (24,211,849) (601,674) (49,509,486) (65,789,292)Net Commission (5,420,727) (3,070,767) (11,505,662) 3,587,917 (16,409,239) (24,001,453)

Underwriting result 19,315,090 13,908,128 (19,099,403) 4,229,625 18,353,440 29,591,846

Investment Income 11,659,428 12,155,650Other Income (Profit on Sale of Fixed Assets) 759,449 1,135,696Financial Charges (264,231)General and administration expenses (7,440,733) (7,863,793)

Profit before tax during the half year 23,067,353 35,019,399Provision for Taxation :Current (5,500,000) (10,300,000)

Profit after tax during the half year 17,567,353 24,719,399

Profit and Loss Appropriation Account

Balance at Commencement of the Period 41,029,056 70,886,713Profit after tax during the half year 17,567,353 24,719,399Transfers to reserves ( General Reserve) (7,500,000) (17,500,000)Issuance of Bonus Shares for the year 2008 10% (2007:30%) (22,909,250) (52,867,500)

Balance Unappropriated profit at the end of the period 28,187,159 25,238,612

Earning per Share - Basic and Diluted Note 8.1 0.70 0.98

CONDENSED INTERIM PROFIT & LOSS ACCOUNT (UN AUDITED)FOR THE QUARTER AND HALF YEAR ENDED JUNE 30, 2009

Ismail H. Zakaria Mohammad Amin Ahmed Bawany A. Aziz Ayoob A. Razak Ahmed Chairman Director Director Chief Executive & Managing Director

The annexed notes from 1 to 12 form an integral part of these condensed interim financial statements.

KARACHI : 20th August, 2009

FORM GB


7

PermanentDiminution Unappro-

Total Share General In Value Of priatedCapital Reserve Investment Profit

Balance as at 01-01-2008 176,225,000 62,500,000 5,105,000 70,886,713 314,716,713

Net Profit after tax for the year - - - 40,509,843 40,509,843

Issuance of bonus shares and transfered to general reserve 52,867,500 17,500,000 - (70,367,500) -

Balance as at 31-12-2008 229,092,500 80,000,000 5,105,000 41,029,056 355,226,556

Net Profit after tax for the six month period - - - 17,567,353 17,567,353

Issuance of bonus shares and transfered to general reserve 22,909,250 7,500,000 - (30,409,250) -

Balance as at 30-06-2009 252,001,750 87,500,000 5,105,000 28,187,159 372,793,909


CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITYFOR THE HALF YEAR ENDED JUNE 30, 2009


Karachi : 20th August, 2009


8

Half Year Ended Half Year EndedJune 30, 2009 June 30, 2008

(Amount in Rs.)Operating Cash Flowa) Underwriting activities

Premium received 188,242,890 276,168,830Reinsurance premium paid (97,948,404) (85,910,168)Claims paid (119,220,757) (154,909,350)Reinsurance and other recoveries received 42,027,451 49,791,978Commission paid (28,661,059) (43,491,141)Commission received 29,765,288 33,120,487

Net cash flow from underwriting activities 14,205,409 74,770,636

b) Other operating activitiesIncome tax paid (7,158,314) (16,414,985)General management expenses paid (49,509,486) (65,789,292)Other operating payments (2,246,622) (1,891,098)Loans advanced / repayment received (207,950) 39,924Other payments on operating assets (2,105,489) 1,382,109Other receipts in respect of operating assets 457,906 (313,142)

Net cash flow from other operating activities (60,769,955) (82,986,484)

Total cash flow from all operating activities (46,564,546) (8,215,848)

Investment activitiesInterest / Dividend received 39,405,447 23,021,067Payments for Investments (36,337,980) (19,895,730)Proceeds from disposal of investments 55,764,927 7,604,616Fixed Capital Expenditures (4,182,645) (14,057,922)Proceeds from disposal of fixed assets 2,170,000 3,875,000

Total cash flow from Investing activities 56,819,749 547,031

Financing activitiesUnclaimed Dividend paid (5,204) (3,443)Financial Charges (264,231)

Total cash flow from financing activities (269,435) (3,443)

Net cash Inflow/outflow from all activities 9,985,768 (7,672,260)

Cash & cash equivalent at the beginning of the year 79,257,002 94,953,344

Cash & cash equivalent at the end of the period 89,242,770 87,281,084

Reconciliation to profit and loss Account

Operating cash flow (46,564,546) (8,215,848)Depreciation expense (5,194,111) (5,972,695)Financial Charges (264,231)Profit/(loss) on disposal of fixed assets 759,449 1,135,696Increase/(decrease) in assets other then cash 52,135,072 42,880,169(Increase)/decrease in liabilities other then running finance 5,036,292 (17,263,573)Investment Income 11,659,428 12,155,650

Profit after tax as per profit & loss account. 17,567,353 24,719,399

Definition of CashCash in hand and at Bank, Stamps in hand and short term placements with banks cash for the purposes of the Statement of Cash Flows Consists of:

Cash and Equivalents 385,648 221,609Current and other account 63,347,280 58,334,475Deposits Maturing Within 12 Month 27,525,000 28,725,000

91,257,928 87,281,084Short Term Running Finance-Secured (2,015,158)

89,242,770 87,281,084

CONDENSED INTERIM STATEMENT OF CASH FLOWS (UNAUDITED)FOR THE HALF YEAR ENDED JUNE 30, 2009



FORM GC

Karachi:20th August,2009


12

(Amount in Rs.)

Quarter ended June 30 Six Months ended June 302009 2008 2009 2008

Income from Non-Trading Investments

Held to maturity

Return on Government Securities 2,759,489 2,315,321 4,551,193 2,754,982Return on other Fixed income Securities and Deposits 1,422,075 1,006,431 2,210,887 1,889,478

4,181,564 3,321,752 6,762,080 4,644,460 Investment Held for Trading

Dividend Income 3,360,881 2,404,853 8,112,430 5,983,653

Avilable for sale Dividend Income 120,082 140,495 120,082 171,067

Gain on sale of ‘available for sale investment’ 554,726 1,373,183 1,691,755 1,377,238

Impairment in value of investment (2,500,000) - (5,000,000) -

Less: Investment related expenses (11,500) (15,598) (26,919) (20,768)

5,705,753 7,224,685 11,659,428 12,155,650Net Investment Income transferred to P&L A/c.


CONDENSED INTERIM STATEMENT OF INVESTMENT INCOME (UNAUDITED)FOR THE HALF YEAR ENDED JUNE 30, 2009


KARACHI :20th August, 2009

FORM GG

1. STATUS AND NATURE OF BUSINESS

The Reliance Insurance Company Limited, was incorporated in Pakistan as a public Limited Company on 4th November 1981, and is engaged in General Insurance Business. The shares of the Company are quoted on Stock Exchanges of Karachi and Lahore.

The registered Office of the Company is situated at 96-A, Sindhi Muslim Co-Operative Housing Society, Karachi.

2. Basis of Presentation

These condensed interim financial Statements are unaudited have been prepared in accordance with the requirement of the Insurance Ordinance, 2000 and International Accounting Standard –34 (IAS-34) “Interim Condensed Financial Reporting” and are being submitted to the shareholders as required under section 245 of the Companies Ordinance, 1984 and with the Listing regulations of the Karachi and Lahore Stock Exchanges where Company is listed. These condensed interim financial statements are being presented in accordance with the format prescribed by the Securities and Exchange Commission of Pakistan for Non-Life Insurance Companies through circular # 7 of 2003 dated 27 August 2003.

These condensed interim financial statement do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Company’s annual financial statement for the year ended December 31, 2008.

The Security and Exchange Commission of Pakistan through its notification SRO-149(1) 2009 dated 11th February 2009, had adopted IFRS-4 on insurance contracts to be followed by insurance companies and others with effect from January 1st 2009. However the implementation of some paras in the said IFRS has been deferred by SECP through its circular # 22/2009 dated 30th June 2009, for the purpose of the quarterly accounts, for 1st, 2nd and 3rd Quarter of the year 2009. other related requirement of IFRS4 requirement have no impact on these condensed interim financial statement.

3. Accounting policies.

The accounting policies applied in preparation of these condensed interim financial statements are the same as those applied in the preparation of annual financial statements for the year ended 31 December 2008.

4. Premium Deficiency Reserves

No provision has been made as the unearned premium reserve for each class of business as at six months period ended is adequate to meet the expected future liability after reinsurance from claims end other expenses, expected to be incurred after the balance sheet date in respect of policies in force at the balance sheet date.

5. Taxation

The amount set aside for Income Tax is provisional, final liability will be determined on the basis of annual results.

6. Transactions with Related Parties

Details of major transactions with related parties for the period ended 30th June,2009 are as follows:

Jan - June Jan - June2009 2008

Premium Underwritten 11,092,601 9,927,714Premium Collected 12,347,872 15,213,595Claims Paid 3,004,936 8,615,496Commission Paid 1,805,961 1,971,883

The transactions were carried out at the arm’s length in accordance with the policy of the company.


13

NOTES TO THE ACCOUNTS INTERIM FINANCIAL STATEMENT (UN AUDITED)FOR THE HALF YEAR ENDED JUNE 30, 2009


14

7. Investment. 31st June. 31st Dec.The investments comprise of the following: 2009 2008

Held to maturity 99,151,595 105,968,238Available for sale 34,369,414 53,528,315Investment held for trading 149,602,280 141,361,928Impairment in value of investment (20,000,000) (15,000,000)

263,123,289 285,858,481

7.1 The market value of investment in Shares & Securities as on 30th June 2009, was Rs. 185.714 million (as at 31st December 2008, Rs.139.982 million).

7.2 The impairment in value of Investment portfolio was recognized for Rs.2.5 million according to the SECP circular # 03/2009, treating the fall in value of available for sale investment as other then temporary 25% of the difference as at end of quarter between the cost and market value as at 31st December 2008, after adjusting for the price movement during the quarter, recognized through a Profit & Loss Account. During the six months period ended 30th June 2009, the company has recognized Rs.5.00 million.

7.3 In compliance with the directive of SECP vide its Circular No.15 of 2008, dated 7th July 2008. Pakistan Investment Bonds (PIB) for the face value of Rs.30.00 million have been deposited with State Bank of Pakistan under clause (a) of Section 29(2) of Insurance Ordinance 2000.

8. Share CapitalIssued, subscribed and fully paid.

June December June December2009 2008 2009 2008

(Number of Shares)

1,156,680 1,156,680 Ordinary Shares of Rs.10 eachFully paid in cash 11,566,800 11,566,800

24,043,495 21,752,570 Ordinary Shares of Rs.10 eachIssued as fully paid Bonus Shares 240,434,950 217,525,700

25,200,175 22,909,250 252,001,750 229,092,5008.1. Earning per share June June

2009 2008

Profit after the tax during the period 17,567,353 24,719,399

Weighted average number of share of Rs. 10 each 25,200,175 25,200,175

Earnings per share Basic and Diluted 0.70 0.98

Earnings per share for the corresponding period have been adjusted for the effect of subsequent issue of bonus shares.9. Fixed Assets-Tangible and Intangible.

The details of addition and disposals have been made in the fixed assets during the period ended June 30, 2009.are as Follows:

Additions DisposalsVehicles 3,119,750 2,170,000Furniture & Fixture 6,600 —Office Equipments 306,425 —Computers 198,670 —Computer Software 551,200 —

10. Contingencies and Commitments10.1. There are no material contingencies existing at the Balance Sheet date. 11. Date of Authorization for issue

These financial statements have been authorized for issue on 20th August 2009, by the Board of Directors ofthe Company.

12. GeneralFigures have been rounded off to the nearest rupee.


Karachi : 20th August, 2009

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